The Scottish third sector tracker - wave 12 report (Spring 2026)
The twelfth wave of the Scottish third sector tracker paints a picture of a sector that remains resilient but continues to operate under significant pressure. Financial challenges remain widespread, with difficulty fundraising, rising costs, and funding uncertainty continuing to affect a large majority of organisations. While many organisations remain confident about their future and are continuing to deliver planned services, this is increasingly being achieved through adaptation, the development of new income streams, and, in some cases, the use of financial reserves.
Recruitment and retention challenges remain a feature of the operating environment, particularly in relation to volunteers. Organisations report fewer people coming forward to volunteer and increasing pressures on their capacity to recruit, support and retain volunteers. Recruitment of paid staff also remains difficult, driven by uncompetitive salaries and skills shortages.
The findings also highlight the increasingly complex social and political context within which voluntary organisations operate. One-third of respondents reported challenges linked to the changing socio-political environment, including funding pressures, growing demand for services, social division, discrimination and difficulties engaging with public bodies and decision-makers. When asked what support would help, organisations consistently called for more sustainable funding, stronger representation, better relationships with government and practical support.
New questions on procurement suggest that many organisations perceive procurement systems as difficult to navigate and often inaccessible, particularly for smaller and volunteer-led organisations. At the same time, responses on financial reserves demonstrate the importance of reserves for organisational resilience, continuity of service delivery and strategic investment.
Overall, the findings suggest that the sector continues to play a critical role in supporting communities across Scotland but is doing so in an environment characterised by increasing demand, financial uncertainty and capacity pressures.
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